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What is remortgaging and how does it work?
When remortgaging, you are moving your mortgage from one lender to another. A remortgage broker can help you find a new mortgage to replace the old one. You may decide to remortgage your property if you are coming to the end of your current mortgage rate, planning to borrow more against your property or want to find a better deal than you can get with your current lender.
Remortgaging might be a good idea if:
- The introductory rate on your existing mortgage is coming to an end and you want to avoid automatically transferring to your lender’s standard variable rate
- You want to consolidate your debts
- You need funds for home improvements
- You want some cash to pay for a large expense such as a wedding
- Your property has increased in value and you want to move to a lower rate by moving to a lower loan-to-value mortgage
- Your current lender’s transfer rate is high and remortgaging is a more cost-effective option
Remortgaging might not be a good idea if:
- Your existing mortgage has high early repayment charges
- You only got your current mortgage within the last six months
- You are only looking for a small mortgage under £20,000
Why use a remortgage broker like Ayla Mortgages
IT’S SIMPLE WITH US
Our remortgage process
You’ll find remortgaging through Ayla Mortgages quick, easy and hassle-free.
Once you’ve contacted us, we’ll arrange an appointment for you to speak with a mortgage consultant either in-person, via video chat or over the phone — whatever works best for you. Your remortgage adviser will ask you a few questions to learn about your circumstances. Once they’ve gathered all the information they need, they’ll begin searching for the best remortgage deal for your current and future needs. They’ll then contact you to arrange a follow-up appointment to discuss their recommendations with you.
Decision in Principle
Once your adviser has provided you with their recommendation for a remortgage product and you confirm that you are happy to process, they’ll begin securing your Decision in Principle (DIP). This is the lender’s indication that they’ll loan you the funds subject to the property’s valuation, on the condition that the information you’ve provided is correct.
When you’ve received your DIP, your mortgage adviser will begin preparing your application for a remortgage. We go through all the paperwork and submit your full mortgage application to the lender on your behalf.
Underwriting and valuation
Underwriting is a process by the lender where they verify all the documents and information in your application. We also arrange for a valuation on the property to ensure there aren’t any significant issues with it. Sometimes a lender may not require a physical valuation but carry out a desktop valuation instead, as the property will have had a valuation and inspection when you initially took out a mortgage.
Once the underwriting process and valuation are complete and the lender is happy, they will accept your mortgage application and send an offer to you and your adviser at Ayla Mortgages.
After accepting the offer from your lender, the conveyancing process begins, where a solicitor will arrange all the legal paperwork.
Once all the paperwork has been signed, your solicitor will set a date to draw down the new funds to clear the outstanding loan you have with your current lender. If there are any excess funds, they will be given back to you.an
The benefits of remortgaging
There are considerable benefits to remortgaging your home, including saving money, staying put, raising cash and more.
When you come to the end of your introductory mortgage deal, you’ll automatically be put onto the lender’s standard variable rate. This could be higher than what you were paying with your original rate. Remortgaging can help you make considerable savings.
Avoid having to move home
Funding home improvements to your home by remortgaging rather than moving home can be significantly cheaper.
Opportunity to raise extra cash
If you have debt you want to consolidate or need to pay for a major expense coming up, you can remortgage for a larger amount than the outstanding balance on your remaining mortgage. This can often be cheaper than having to borrow separately from other sources.
Helps you adapt to a change in circumstances
If there’s been a change to your financial situation, you may require a new mortgage that better accommodates your new circumstances. This could be a lower monthly rate or the opportunity to make larger overpayments. Remortgaging is a great way to replace your existing mortgage with one that is more suited to your current requirements.
What fees are involved in remortgaging?
There are certain fees involved in remortgaging a property. These can include lender fees, valuation and conveyancing fees. You may find that your lender will include valuations and conveyancing for free as part of the remortgage deal. The cost of remortgaging will largely depend on how much you want to borrow, the interest rate, the type of mortgage, the length of the mortgage term and any fees you were charged to set it up.
A lender’s product fee can be anything from £0 to £1,499, while valuation fees can vary from £0 to £1,500. Legal fees and costs can range from £0 to £500 plus VAT. If you try to remortgage your property before the end of your introductory deal, you could face an early repayment charge. You can usually remortgage a property up to six months before your current rate ends.
Here you’ll find comprehensive answers to some commonly asked mortgage questions. If you have a question that isn’t answered here, please contact us and we will be very happy to help you
The two main types of mortgage are a repayment mortgage and an interest-only mortgage. We recommend to book an appointment with Ayla Mortgages to advise on the best lender and product for your remortgage, the mortgage consultant will also be able to advise you on whether a variable rate mortgage or a fixed rate mortgage is right for you.
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